♪ carol: welcome to "bloomberg business week." i'm carol massar. jason: we're here inside headquarters in new york. that here at home, 10 years since the 2008 financial crisis, a learned -- look at the long-term political effects. carol: we are going to start with the nafta showdown. twists and turns, talks between the united states, canada and exico.

jason: this is your brain on nafta. here is editor matthew philips on what really went down behind the scenes. atthew: a major television moment but the president, which he very much wanted to have. he brought the press into the oval office. he thought he would win a bilateral deal with mexico. the canadians were not included. t was a big moment for trump and he happy press there. he was going to get the mexican president on the speakerphone, with communication issues, wkward for a moment. it seemed as if the mexican president was not on the line. staff scrambled to fix the connection. it was a microcosm of the past year of negotiations.

nafta had been not well coordinated, wildly oversold, written by a president who just wants to win. the optics for trump seems to be what is most important. jason: while president trump campaigned heavily on nafta and the renegotiation of the united states, the dissolution of this treaty, he was not personally nvolved along the way. who were the primary architects across the board and how did they play together among the countries? matthew: the guy representing the united states is bob lighthizer. in an administration filled with not very experienced people when it comes to government work, this guy is a 40 year veteran, a

trade lawyer. he was a deputy trade representative for presidents reagan in the mid-80's. e has been leading this. what's been interesting is how he has been able to operate, given that trump has been hands off. bob lighthizer has been able to make inbounds. carol: i don't think we have a concept of what it takes to renegotiate a complicated trade agreement. a year is not a long time for this to drag on, considering how long it takes to get nafta to be a deal. matthew: a trillion dollars of trade happens under this deal. the idea of putting this into hyper-drive was never realistic. bob lighthizer's plan was to browbeat canadians into

submission one year ago. that has gotten bogged down into something like trench warfare. even though all three parties wanted a deal, it was for different reasons. the canadians and mexicans wanted to modernize nafta to cut through the red tape and encompass more trade, whereas the u.s. simply wanted to get a better deal for the united states. jason: all three parties came to the table with different objectives. bob lighthizer has had a certain amount of autonomy, given his experience -- he came less able to haggle as maybe the mexican and canadian counterpart did.

they started in a different way. matthew: they started off unified. they kind of locked arms and saw it in their common interest to form a united front against the united states. they were able to block a good bit of the progress. this past week we had only done a third of the actual provisions n nafta. we forget the traveling roadshow of this thing. every month they go to a different city and hunker down into a hotel in mexico city or in ottawa or a dingy hotel in arlington and lock eyes and get into -- what we forget is the mind-numbing details that come with this thing, haggling over the definitions of "and" or

"or". or the details of washing chicken. our writer, josh, gives us a nice scene of what it has been like to witness on the front lines. jason: we just heard a lot about the nafta negotiations. the u.s. chose to negotiate solely with mexico from the outset. cars may have something to do with it. tell us more. taylor: what i have is a chart of the u.s. imports, the auto sector relative to u.s. imports from mexico into canada. this has increased over time. imports of canadian auto sectors have been falling.

this might have been white was the trump administration's focus. jason: next, china is sidelined by president trump, but will china ever become a real superpower? what does that look like? carol: europe is at the end of a german automaker spending spree with opal finding a new ceo. jason: this is bloomberg businessweek.

carol: welcome back. jason: you can find us on businessweek.com. carol: and our mobile app. jason: china continues to expand ts global influence. carol: could its demographics and middle income trap stand in the way of it becoming a real superpower? jason: our reporter chose to begin the story in antarctica. we asked him to explain. >> i was in beijing, talking to one of the heads of state, fairly loyal to the regime. he was talking about how he had been to antarctica. it is no small trip to make from beijing. he was looking to see whether china's interest as a new global power was being taken care of.

e decided it wasn't. ntarctica, there is an agreement in place. you can't dig up fossil fuels or iron. in the arctic, you have more at lay. this white paper was being sent from a think tank to president xi for his to comment on, was china's reach is sufficient in antarctica for the kind of lobal power it now is? jason: this is almost a question of what china wants to be, being a superpower and vis-à-vis the u.s. definition of a

superpower. what happens next and why does china have this push and pull internally over the osition? marc: the other thing that came out of this antarctica trip, a real dilemma for the chinese. they don't want to be the united states. they don't want to be the next global hegemony. they don't want to replace the united states. they talk about how the united states tries to solve too many problems militarily.

china wants to do things differently through economics, and so on. there is only one yardstick at the moment to measure yourself as a great power and that is the united states. they find themselves doing it anyhow. in antarctica, you look at how many research stations the americans have. "we ought to have something similar." they find themselves in this dilemma. they understand the cost of being a superpower is pretty large. the united states is struggling -- the gdp cap of the u.s. is $60,000 and in china it is 9,000. jason: the economic backdrop for china is quite different. if this is a superpower in the making, it may be a fragile one, which owes largely to the emographics. marc: the demographics pose the most fundamental challenge for china.

china's great, natural resource, on which its success have been based is its people. the number of people living in the countryside, moving into cities, becoming more productive, has determined the ability of china to grow the way it has. china's population has already begun to age. the working age population has already begun to shrink. the lower age population will begin to shrink as early as 2023. the median projection of what happens to the population is backed by 2050 it loses around 00 million people, relative to

its current size. in that circumstance, no superpower has ever developed when that was happening. jason: the stunning turnaround of opel -- call them the anti-musk, a frugal, camera shy ceo who has brought his company back to profitability. carol: this was after two decades of being within the red, and profit was achieved within only one year. >> opel in europe used to be one of the biggest european car manufacturers. since then, there has been a very dramatic decline in market share. they got crushed by the

competition for many years. just over a year ago, general motors took the step to sell opal. a french car manufacturer took over the company. the results of the first half of the year has been very strong. this has been the first profitable half of the year at pal in 20 years. jason: and p.s.a. is the owner and citron. i want to read this line -- the challenge has been how to profitably produce low-margin cars in a high cross-country. that is quite difficult to

navigate. the new ceo seems to be making bold, but ultimately effective decisions. tell us about him and what he as done. >> the ceo has emerged in recent years as one of the most high profile ceos in the industry. there is a lot to talk about musk and tesla and may be going private and abandoning the lan. in many ways, the ceo of psa is the complete opposite of elon usk. he is very reserved, extremely disciplined. he has a very strong track record of meeting all his financial targets. he has been a key driver behind the turnaround at the french manufacturer itself.

he took over as coo of psa. expectations were skeptical at the beginning. it is based in a high cost country like france, with a strong focus on europe, and he repeated that restructuring at opel, even though the industry is facing difficult times. he imposed a lot of discipline to make this work. jason: nike's #metoo movement has evolved into something bigger. carol: a group of employees are suing it over alleged gender discrimination. this is bloomberg businessweek.

jason: welcome back.

carol: you can also listen to us on the radio at sirius xm, and new york, boston, washington dc, and in the bay area. jason: and in london. arol: sexual harassment claims at nike followed a similar path in the #metoo era. women made claims, executives left. jason: but four former employees are suing the athletic apparel giant fort gender discrimination and limiting the opportunities for women to advance in the company. carol: here is our editor. jim: the typical #metoo story, somebody abused somebody else or a number of people. a few people are fired and that

is it. what is happening at nike is four former employees have filed suit, saying this is an issue about whether the company policies are still here after 11 executives were gotten rid of earlier this year for bullying and harassment. they are saying, let us deal with this systemic issues that often go hand-in-hand with harassment. carol: i think a lot of states are looking at this policy. jim: one of the often overlooked reasons for why women in the workforce are often paid less than men is that they often start being paid less than men. a lot of companies base their ay on what you made at a previous job. if you worked at a job tthat

undervalued you before, you are already starting out lap or two behind your male ounterparts. one of the people we talked to for this story has gone to a competitor, she says that when she was working at nike, she was paid a 20,008 all ye -- $20,000 a year less than guys in her same department doing the exact same job. some states have decided that is an issue they want to get rid of. number of states say that you cannot base starting pay on revious pay. this is a way to try to give women and equal shake. nike says it plans to get rid of this practice. jason: you have look at companies across the spectrum for a long time. why is this happening at

nike? what is it about that place? jim: one of the reasons we were so interested in this story, and this is the second one we have done regarding nike, it is known as a place where they try to value employees and have been vocal in saying that they have almost reached pay parity for women in comparable jobs. everyone expected this not to be the company where this happens. this happens at even the best companies. this is much more of a difficult and institutionalized problem, how pay is set and how that affects people of different genders and probably people of different races, backgrounds and ages.

it is much trickier -- you can say i want to do the right thing, but policies are in place where promotions gets sent by a group of people who often may not want to promote certain types. then you've got a problem. carol: i am assuming all of corporate america is watching this lawsuit by four former employees very closely. the ultimate goal is to prevent this from becoming a class -- is to make this into a class action lawsuit. jim: for the people suing the company. damages could go to a larger group of women and a address the issues for a larger group of women instead of these individual clients. that is difficult. it is difficult to get class-action status and it is difficult when you are talking about sexual harassment. harassment is often thought of

as a one-on-one case. very few companies have a policy that says, we will harass women. carol: right. jim: companies will say, this is an individual case by an individual person, so you cannot sue us as a company. but also, there is the issue of ay discrimination -- it is easier to prove that because you start looking at numbers and data, and data is much harder for a company to say, don't look at that, as opposed to ne-on-one. jason: what tim geithner feared in a moment of the 2008 financial crisi. carol: and we explain how blackrock won the decade.

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jason: welcome back. carol: twitter, going to be in the news this coming week. is it biased against conservatives? jason: and david westin's conversation with warren buffett. carol: and a look back at the 2008 financial crisis. jason: joel weber spoke with us

about the impact of the crash on olitics 10 years on. joel: september 15 is the date. that is 10 years from the lien in bankruptcy -- what are some other stories we can talk about 10 years later? one of them is the opening remarks from josh green, drawing lines from the 2008 financial crisis to where we are in the world right now. it starts with an anecdote from timothy geithner. it is a moment in time with him trying to right the world and foreshadowing the political ramifications of the financial crisis would be out of his control.

carol: back in 2010, you would have thought that tim geithner was going to change the carol: back in 2010, you would world. yet he had his doubts. joel: you hang on the occupy wall street, right? more of the left. the right side got the tea party. the tea party led to steve bannon,. than two donald trump -- then to donald trump. the outrage over the bailouts, this low level simmering, has anifested itself in trump. jason: who ultimately came out a winner? there is a clear one. joel: blackrock. over the past ten years, there is a shift from the sell side, bankers, to the buy side, investors.

that's encapsulated with firms like blackrock, but also private equity. this is one of the legacies of the financial crisis. what is interesting to me and the small ways they have been able to do that. one of the most ingenious acquisitions was blackrock acquiring ishares, at the time a barclays property. carol: you talk about having the money to make that acquisition. joel: not having the regulatory oversight the banks had so they were able to do these chess moves that everyone could look back on in hindsight and go, they a stick -- aced it. jason: in financial crises, they are as much about politics as

economics. tim geithner helped halt another reat depression, but the effects of the disruption never really went away. carol: josh green knows what goes on behind the scenes. josh: over the 10 years since the crisis and how it has affected politics, i kept eturning to an interview i had with tim geithner. i had been wallowing him throughout 2009 to do a magazine profile.

the final interview i had with him, in his treasury office, this was in january at 2010. it was clear that obama's economic team was looking to stop the contagion and the stock market was backed up. and tim geithner was almost unhappy because this was the moment when he was realizing that while the rescue had helped economically, there was going to be a political price. if you look at american politics over the subsequent 10 years, i would submit the main recourse was the financial crisis and the government's reaction. jason: this leads directly to where we are today politically. i want to take you back to another thing we point out. there was a choice that the obama administration made, that set us on this course. it gives rise on the left to one thing and the right to another. talk about that choice of growth over everything else. josh: the crux of my profile of tim geithner back in 2010 was

trying to understand how he was approaching the crisis. what's geithner and obama did was make a decision -- they said, we have this terrible financial crisis. the quickest and cheapest way to recover is to get the economy growing again. we will focus on growth above all else. that entailed the moral choice not to punish bankers or put them in jail and nationalize banks. from a strictly economic standpoint, tim geithner and obama has been vindicated. the u.s. has spared much better in the recovery than it was back in 2010. but by declining to satisfy what geithner derisively referred to

as the public clamor to hold wall street bankers accountable for the damage they caused, this created a political backlash. you could see that as long ago as january 2010, when ted kennedy has just died, and was replaced unexpectedly by a epublican. that was the first sign of the backlash. when you look at the subsequent energies in our politics, from occupy wall street to the tea party, what you see is a backlash to the political choices made in the wake of the risis. we have had wonderful macroeconomic headlines and job growth and a record bull market, the recovery still has not reached the growing middle class. wages has been stagnant. there is a distrust with political leaders that manifested itself on the democratic side and republican ide.

donald trump managed to defeat 16 qualified republicans to get himself elected president. that was a backlash to the inancial crisis. jason: how the financial crisis destroyed a number of wall street firms, but provided an opening for others. carol: and david westin's conversation with warren buffett. jason: this is bloomberg businessweek. ♪

jason: welcome back. carol: you can also find us online at businessweek.com. jason: and on her mobile app. carol: some firms did not make it through the crisis. jason: but blackrock can trace much of its growth back to the meltdown and the way the financial industry globally has changed in the last 10 years. carol: we have more from our reporter. annie: blackrock has a couple of reasons it came out a winner in the crisis. they made an important acquisition during that time with bgi, a business that included the etf business they came to owner. jason: it was a big deal in size. there are a few could do it. it came at a time before everyone else was convinced etf's and passive investing for the wave of the future. annie: it was a huge deal. blackrock concluded we can build this business by ourselves but it would be great to be in this arena. when the ishares business was up for sale, they were able to take

it. business has really paid off for them. today they are the global leader n etf's, 1.8 trillion. carol: and that was the big push back against excessive fees and passive investing. timing could not be better. nnie: what we have seen is a huge explosion in passive investing that has allowed lackrock to really profit. it has not slowed down. jason: larry fink is a guy who

was well-known known for a want of reasons, not the least of which is, he knows risk. that goes back to the 1980's. he gets fired for a big bet that goes the wrong way and goes into the comfortable arms of blackstone. but the risk is always so much in the back of his mind and never was that more important than over the last 10 years. annie: larry fink is a process of over risk. he had his own major loss when he was at first boston. in the 10 years of the financial crisis, the firm has become more cognizant and read about financial risk and looking at to their portfolios for white -- what they might not be seeing. blackrock cells risk analytics to other businesses, including insurers, tension funds, rival asset managers, and that business has taken off for them. it is called aladdin. it is not as big as etf's, but the size of the assets that this platform overseas was somewhere around the $7 trillion in 2000 eight.

now it is responsible for $18 trillion worth of assets. it is enormous in terms of the cope and power of that latform. carol: when every warren buffett shares insights on the state of markets and the economy, it is definitely news. he shares them with our colleague, david westin. jason: here is some of his interview. david: 1960, the percentage of gdp taxes has gone from 4% to 2%. you are now involved in a joint venture with jpmorgan. how are you going to bid on that cost curve as a practical matter? warren: get the smartest people

we can working on this. and basically give them free reign. and not expect something is going to happen next year or the year after. every dollar has a constituency. you cannot just chip a little it here and there. we are not in a hurry as we would like to be, but we are not going to try and move something faster than it could be one. david: what is being done? warren: hiring people. there is a focus on looking at the system and saying, can the system check this percentage of gdp growing higher than any other country and can it be done to deliver a better product for atients?

david: when you try to bend the cost curve, you either spend less than what you are getting already or you get less. how much of this will be striking monopoly rents out of the system? how much of this will be saying, you cannot have the health care service you expect? warren: we will not do it unless a majority of people feel that way. it is not impossible to think smarter about something. you get rigidity's built in. it is hard to rearrange.

it is like a rubik's cube. it is a big challenge. jason: that money has to come out of somebody's pockets. >> there have been locations. we have been disrupting farming ever since we had 80% of people n farms. this variation would not be so bad. 2% of the people are more productive than 80% were a couple hundred years ago. jason: politicians love twitter, until they don't. the debate over free speech could be costly for the company. carol: and more about a transportation transformation. jason: this is bloomberg businessweek. ♪

carol: welcome back. jason: you can also listen to us on the radio, in new york, boston, and in the washington d.c. and bay areas. carol: and in london. jason: some people are facing pressures over free speech policies. carol: what type of pressure should be allowed on social media platforms and are these rules being enforced fairly? jason: twitter has a lot riding on this debate. joshua: twitter does not have the resources to deal with this issue and employee used to deal with the same type of content oderation. but jack dorsey has made this point before.

it is held to the same standards as a you tube or facebook, but it does not have the same resources to back it up. twitter is at this precarious point in this lifetime. it has been on the cusp of the turnaround over the past several months. it has been showing that it is able to generate sustainable growth and survive as this independent company, but it is undercut between this -- with this political debate that threatens to derail some of its growth. they can afford to lose one or two out of its platforms but if the perception of its anti-conservative bias continues, it could face the oss of many users. jason: jack dorsey and infowars has been at the center of this debate for all of the social media platforms. twitter at least initially went

a different way on that decision. bring us up to date>> the saga started when larger on that. platforms like facebook and apple and youtube decided to remove most of alex jones' content from their platforms. this has been ongoing for several years. jones is a notorious right-wing conspiracy theorist, and some of his most egregious theories include claiming the sandy hook shooting was an elaborate hoax. many critics say those types of conspiracies are abusive and is spreading hateful content, as well as claiming people involved in these tragedies are crisis actors. when these platforms decided to remove this content, they said, we're continuing to do usiness.

there was an outpouring of criticism for jack dorsey -- think more about the ethical implications, rather than wanting to appear as an apolitical platform. twitter went back and deleted flagged tweets -- then twitter banned him for a week. it is this back and forth. carol: wait until you hear about uber's latest venture. jason: it plans to expand with bikes and scooters. carol: we look into this two-wheeled future. joshau: uber is also building its scooter-sharing service, the same way it is working on self

driving cars and flying taxis. jason: uber was at the forefront of ridesharing. it has had its share of controversies, but scooters -- we have seen mini-protests flare up and people breaking them in san francisco. how are they navigating his? pun intended. joshua: uber has realized in a place like san francisco, a lot of trips are kind of a drag to do in a car. having something like an electric bicycle or a scooter is faster and more pleasant to go a mile or three miles. earlier in the spring, a couple of other startups started putting scooters out on the street in san francisco. you could unlock them with an app and leave them where ever

you wanted. it caused a bit of chaos, similar to what happened when uber came in with ridesharing. uber has been around for a decade now. they have played conservatively. they have not gone in without getting permission from cities. they have applied for permits in san francisco and santa monica to launch a scooter-sharing service. jason: you mentioned the smaller footprint of a bike or a scooter. it feels like over the past few years, people are embracing almost philosophically this idea of hopping on a bike and going a few miles. have we hit that to point where consumers are willing to do this, that the kids are more willing to do this? i am an old guy and use a city ike.

joshua: we are seeing a lot of discussion about this. everyone knows there was controversy in san francisco. there are not that many scooters out in the street. what we are seeing is the beginning of a conversation on how we will have cities that have a lot of transportation modes that are not cars, or only walking around? things will need to be done differently. inconvenience coming from these new modes of transportation, everyone is aware of. jason: next week, we take into several cities around the world. what they are doing and what citizens are expecting. carol: bloomberg businessweek is available on newsstands now. jason: and online and our mobile app.

what was were favorite story this week? carol: what kind of superpower china wants to be. we forget china is making long-range steps in terms of developing its role in the future when it comes to war and peace and technology. a must read. jason: and how the united states is fashioning itself. josh green, i admire how he is ble to unpack the politics and economics of today and where we are going from here. more bloomberg television starts right now. ♪

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time get 150 dollars off and free shipping too. sale prices are available right now. go to buyleesa.com today. you need >> antisocial, president trump's campaign against what he calls unfair searching in social media. playing it cool, ecb supervisory member saying that regulators are in no rush -- over turkey risks. and the clock ticks until brexit. are the chances of the no-deal more likely? i am nejra cehic in london.